Why one of the largest IT companies in France with more than 100,000 employees is on the verge of bankruptcy

Once a shining star of the French business world, Atos is now facing a critical moment. Its stock price has plummeted, debt threatens to drown it, and a possible breakup looms. This is what happened to the company which was a key supplier to the French nuclear industry and Olympic Games.

What made Atos a giant

Founded in 1997 from the merger of several IT service providers, Atos has undergone numerous transformations over the years. Atos bought Siemens IT Solution and Services in 2011, the French leader in supercomputing Bull in 2014, Xerox ITO for $1 billion the same year, and the American player Syntel in 2018 for $3.4 billion. Atos’ market capitalization jumped and the company entered France(blue chip CAC 40 index in 2017. In 2022, the company had revenues of $12.1 billion) and now employs 105,000 people worldwide.

What led to the fall

* A series of missteps, including the failure to acquire American competitor DXC Technology Co. for $10 billion.
* Accounting errors: In 2021, Atos lost more than €1 billion in market value after revealing that auditors had discovered accounting errors at two of its US entities.
* Leadership changes: The company has seen five different CEOs in the last two and a half years. This further eroded investor confidence.
* Slow to adapt core business: They struggled to adapt to the shift to cloud computing, losing ground to competitors like Amazon and Microsoft. This resulted in lower profits, a decrease in market value and a debt burden of 2.4 billion euros.

Which Atos assets are for sale

* Atos plans to sell its historic IT activities.
* The company’s BDS (cloud, cybersecurity) strategic unit is in talks with Airbus for 1.8 billion euros.
* Atos negotiates with a legal mediator to refinance its debt. Lawsuits were filed against management for lack of transparency.
* The future of the French IT giant depends on its successful restructuring, securing new financing and restoring investor confidence. Restructuring efforts are underway to deal with a debt of 2.4 billion euros maturing in 2025.

What future for Atos

Atos’ survival depends on its ability to effectively manage its debt, sell its assets and adapt to the changing IT landscape. The result will have an impact not only on the company itself but also on its employees, its partners and the French IT sector.